Sample Questions

You're viewing a limited preview. Log in and subscribe to access all questions.

Exam Questions

Question 1
Which is a macroeconomic topic?
A. An increase in the price of gasoline
B. The monthly expenditure of a typical urban household on entertainment
C. A hike in the wage rate of workers in a textile factory in a state
D. The annual growth rate of an economy
Correct Answer: D
Rationale: The annual growth rate of an economy is a macroeconomic topic because it pertains to the economy as a whole, unlike the other options which focus on specific sectors or individual behaviors.
Question 2
Which characteristic is associated with a traditional economy?
A. Trade is heavily dependent on bartering rather than money
B. Privately owned goods and services are standard
C. The government decides how to distribute capital resources
D. Prices and production are driven by competition
Correct Answer: A
Rationale: A traditional economy relies on customs and bartering for trade, rather than a monetary system, which distinguishes it from market or command economies.
Question 3
How is the study of microeconomics different from that of macroeconomics?
A. Microeconomics studies the actions of individual markets and households within an economy, while macroeconomics studies the whole economy
B. Microeconomics focuses on the actions of consumers and households, whereas macroeconomics focuses on the actions of business firms
C. Microeconomics analyzes economic facts and events, whereas macroeconomics analyzes normative judgments and decisions
D. Microeconomics focuses on domestic economic issues, whereas macroeconomics focuses on international economic issues
Correct Answer: A
Rationale: Microeconomics examines individual units like households and firms, while macroeconomics looks at aggregate economic variables like national income and output.
Question 4
Which question would be studied by a macroeconomist?
A. What percentage of an individual's consumer income is spent on medicine?
B. What is the market price of corn?
C. Can a tax on alcohol reduce the number of fatalities on freeways?
D. What is the impact of a constitutional amendment on the federal budget?
Correct Answer: D
Rationale: A macroeconomist studies economy-wide phenomena, such as the impact of a constitutional amendment on the federal budget, which affects the entire economy.
Question 5
Which term describes the acquisition of skills resulting from education or experience?
A. Productivity
B. Tools
C. Financial capital
D. Human capital
Correct Answer: D
Rationale: Human capital refers to the skills and knowledge gained through education and experience, which enhance an individual's productivity.